Fiscal cliff

[cfa]

So nothing concluded, will DJ tank tonite ?

[Musicwhiz]

So nothing concluded, will DJ tank tonite ?

On a lighter note, all I can say is - it must be super stressful as a USA politician!

[LionFlyer]

So nothing concluded, will DJ tank tonite ?

On a lighter note, all I can say is - it must be super stressful as a USA politician!

It is going to be a interesting New Year. I hope it does not start with tax increases.

[specuvestor]

Fiscal cliff and debt ceiling are related but not the same thing

Debt ceiling is primarily concern with the ability for US govt to pay. With US$ as the reserve currency, that is not really the question. The ceiling was there as a political reminder to White House to keep fiscal constrain. It is not the same as US unable to pay.

Fiscal ceiling is more serious because it was a compromise by the parties during last year's debt ceiling debate. The increase in tax and decrease in spending will hurt US GDP growth. I think Eurozone will be in recession this year and if US too, it will not be positive.

[Stocker]

Rather surprise to see market reacting not too negatively to their failed discussion. Many thought they would be heavy selling this morning in Asia.

[greengiraffe]

Rather surprise to see market reacting not too negatively to their failed discussion. Many thought they would be heavy selling this morning in Asia.

I think many market participants are on holiday. Only when new year starts and the full details of the fiscal saga presents itself then we may see the real market reaction.

Overall 2012 is a good year for equities and one has got to be careful about the traditional Capricorn impact.

Personally with subdue global economic outlook, loose economic policies globally will continue to prevail. However any shocks associated with man-made monetary and fiscal policies (since they can be resolved by human beings who first created them) are likely to present buying opportunities.

There is not much alternatives for money on the loose as these flows still need to find a harbour.

GG

[corydorus]

Trading has slowed down for a long time. I guess mainly season players left. Furthermore after 3 years of scares, I think people kind of numb about it. Maybe that's when the surprises will come.

[VestedInterest]

Playing the Devil's Advocate - perhaps some austerity is good for the long-term health of the US Economy?

This exactly what I was thinking. It may be a necessary evil. The economy and markets suffer in the short term for a longer term gain. One should not lose too much sleep if one professed to be a true value investor. Should the talks fail, we should hold on tightly and brace ourselves for a roller coaster right. But please don't throw the baby and everything else out of the window. All the best and Happy 2013 to all!

[cfa]

EU markets don't like the stalemate, all in red.

[corydorus]

Playing the Devil's Advocate - perhaps some austerity is good for the long-term health of the US Economy?

This exactly what I was thinking. It may be a necessary evil. The economy and markets suffer in the short term for a longer term gain. One should not lose too much sleep if one professed to be a true value investor. Should the talks fail, we should hold on tightly and brace ourselves for a roller coaster right. But please don't throw the baby and everything else out of the window. All the best and Happy 2013 to all!

That's exactly what I was thinking in my recent blog. Best chance to stop the printing press ! What's the republicans thinking ?

Growing Pains

Cory